The Impact of Customer Reviews on the profitability of Fabletics

The success of a company in the markets is significantly determined by the power of the crowd. This is mainly through reviews that are made by clients who have already used its products or services. Many people tend to read crowd-sources online evaluations of a firm before they decide to buy its commodities. According to research, consumers take the opinions seriously just like the recommendation that they get from people they trust. Top brands in various industries have recognized the new consumer behavior and are capitalizing on this when developing market strategies. Fabletics has joined the list of the businesses that utilize online reviews to build relationships with clients. The firm was established four years ago, and its worth has grown by over 200 percent. It boasts of over one million U.S-based subscribers and has accumulated profits of over $235 million. Shawn Gold, who serves as TechStyle’s corporate marketing officer, believes that positive clients’ reviews have significantly facilitated the company’s growth in the online fashion sector.

 

According to Kate Hudson, customer reviews have a great impact on the success of a brand, and she has been utilizing them in growing Fabletics. The company understands that sells, consumer retentions, and loyalty are greatly influenced by the opinions of its previous clients. The internet is accessible to many people, and therefore, the online reputation of a brand greatly determines its success. Most consumers do some research on products or brands before making their purchase decisions. A study that was done by BrightLocal revealed that over 84 percent of consumers trust the reviews that they read on the internet. Traditional advertising methods have less influence on consumers.

 

A top market research enterprise that is called L2 conducted research, which showed that about 76 percent of successful corporations have a review segment on their websites. The evaluations enable a business to gain the trust of consumers. Vibe also did a holiday shopping study, which revealed that less than 33 percent of clients visit online mobile phone stores to compare prices while 65 percent of the population are interested in reading reviews.

 

Brands that have been rated well by previous users of their products have a high chance of building robust relationships with clients. They also attract many customers, and therefore, make significant profits. Many companies have currently developed marketing strategies that are review-based, and this has enabled them to strengthen their consumer loyalty and return ratio. Search engines such as Yahoo and Google show the results of positively evaluated businesses on the first page. Google has joined efforts with various review companies to give brands Google Seller Ratings. Research indicates that clients are likely to focus on advertisements that have Google Seller Rating than unrated ones.

 

According to recent studies that were done by BrightLocal, the purchase decision of 74 percent of internet users can be manipulated by the information that they get from crowd-sourced reviews. Fabletics believes that the client reviews give the real image of a specific brand. The company seeks the opinions of its customers before manufacturing its products.

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